Tips for teachers

Selecting a team

The Reserve Bank is keen to see as many students as possible involved in some
way in the Monetary Policy Challenge. Although only three to five team members
will represent their school in the presentation, other class and school members,
teachers or friends are encouraged to get involved by helping the team to
undertake their research and prepare their case. The more students who get
involved the better.

You could consider the following approaches to involve the entire class.

The class could divide into several teams of four and hold an intra-class
play-off to decide which team should represent the school in the presentation
rounds.

The whole class could help with the research, preparation and brief. For
example, the class could be split into groups analysing different sectors of the
economy. Each group could present their findings and one person from each group
could be nominated to join the team competing in the Monetary Policy Challenge.

The team could practise their presentation in front of the class. The class
could pretend to be the judges during a question and answer
session.

Please feel free to contact Rachael Drummond (email mpc@rbnz.govt.nz) with any questions that
arise during your analysis of the economy. If appropriate, Rachael will pass on
your technical or theoretical queries to Reserve Bank economists who will be
more than happy to help.

Links to the curriculum

The Monetary Policy Challenge competition provides a valuable learning
activity for economics students in the senior school, particularly those in Y13
economics classes. It provides a focus for teaching and learning in the
macro-economics section of the course.

The Monetary Policy Challenge links to the curriculum as follows:

NCEA achievement standard: Economics 3.5 (AS 91403).

Demonstrate understanding of macro-economic influences on the New Zealand
economy

By becoming involved in the Monetary Policy Challenge competition students
are encouraged to integrate many areas of the economics curriculum identified in
the achievement standard.

These include:

use recent statistics and current government policies when describing
influences and explaining relationships associated with New Zealand’s
aggregate economic activity

describe the aggregate level of economic activity using the circular flow
model, using the components of aggregate demand in measuring the level of
economic activity, nominal and real GDP and the business (trade) cycle

use the aggregate demand (AD) and aggregate supply (AS) model to describe
the effect on AD of changes in consumption, government revenue and expenditure,
investment, exports and imports and the effect on AS of exogenous changes in
nominal wages, imported factor costs and productivity

describe changes in equilibrium in terms of price level, national income (=
output = real GDP) and employment

describe the influences on New Zealand’s aggregate economy resulting
from monetary policy (the roles of the Reserve Bank [Reserve Bank of New Zealand
Act 1989 and the Policy Target Agreement] and the effect of a change in the
official cash rate on market interest rates and the impact of these on
consumption, investment, exchange rates and net exports, as well as describing
the (inflationary) impact of external influences and the government’s
fiscal policy.